International Trade
Incoming cargo at Puerto Cabello:
- 25,000 tons of wheat from Canada for MOLVENCA.
- Over 1,000 tons of gutted and frozen chicken from
Bunge Alimentos S.A. and BRF S.A. for CASA
- 563 tons of powdered whole milk in 25 containers
from Argentina for CASA
- 474 tons of milk in 17 containers from Paraguay
for PARMALAT.
- 207 tons of unsalted butter in 8 vans, from Uruguay
for CASA
- 108 tons of frozen beef cuts , from Uruguay for
CASA
- 44 tons of whisky from the United Kingdom, for DESTILERÍAS
UNIDAS.
19 ships remain at bay in
Puerto Cabello. 12 of them are carrying 66,000 tons of yellow and white corn;
60,000 tons of sugar. (Notitarde; http://www.notitarde.com/La-Costa/Mas-de-mil-toneladas-de-pollo-llegaron-al-puerto-local-2202208/2014/07/22/340680 and http://www.notitarde.com/La-Costa/Mas-de-25-mil-toneladas-de-trigo-llegaron-al-puerto-2202729/2014/07/23/341023)
Brazil to ask MERCOSUR to speed up application of a no
tariff policy toward Pacific Alliance countries
Brazil will ask MERCOSUR to apply no
tariffs to trade with Peru, Chile y Colombia, in December 2014, as opposed to
the scheduled 2019 date. More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/brasil-pedira-a-mercosur-adelantar-arancel-cero-co.aspx#ixzz38ThUVKE2; El Mundo, http://www.elmundo.com.ve/noticias/economia/internacional/brasil-pide-a-mercosur-adelantar-arancel-cero-con-.aspx)
Logistics & Transport
Government meets with seven airlines
General Luis Graterol, Water and Air
Transport Minister, along with General Rodolfo Marco Torres, Minister of
Finance and Public Banking met again with AIR FRANCE, UNITED AIRLINES,
CARIBBEAN AIRLINES, AVIANCA, LACSA-TACA, IBERIA, and VARIG GOL in order to
reach agreements on the terms of repatriation of their funds. (El
Universal, http://www.eluniversal.com/economia/140723/venezuelan-government-holds-meetings-with-seven-airlines; http://www.eluniversal.com/economia/140723/copa-airlines-expects-venezuelas-debt-settlement)
Oil &
Energy
Weatherford is to expand operations in Venezuela
Weatherford International denies
reports of the sale of their Venezuelan assets to ROSNEFT, and says it will
increase investments in infrastructure, machinery and training, as well as
support local communities here. More in Spanish: (El Universal; http://www.eluniversal.com/economia/140725/weatherford-contempla-expandir-su-presencia-en-el-pais)
Commodities
Tata Motors gears up for South American drive with
first car plant in Venezuela
Tata Motors is setting up a full-fledged car assembly
plant in Venezuela to penetrate the 4.5-million-unit South American market. The
plant, to be operated jointly with a partner, would initially assemble the
MANZA sedan and INDICA eV2 models from completely knocked down (CKD) kits
exported from India, and later be expanded to manufacture other products,
sources in the know told FE. While an announcement is likely by September, the
assembly plant is expected to have an initial capacity of 20,000 units a year.
(The Financial Times, http://www.financialexpress.com/news/tata-motors-gears-up-for-south-american-drive-with-first-car-plant-in-venezuela/1273111)
Economy
& Finance
Economic Vice President heads for NYC to contact
international banks
Vice-President for Economic Affairs and Minister of
Petroleum and Mining, Rafael Ramírez, will soon travel to New York to meet with
international banks and investment funds. One and a half months ago, Ramírez
visited London and told investors that an exchange convergence would take place
in the short term, along with unification of parallel funds. (El
Universal, http://www.eluniversal.com/economia/140724/oil-minister-heads-for-nyc-to-contact-international-banks)
FORTUNE: How to fix Venezuela’s troubled exchange rate
Most people think that the Venezuelan economy is a
basket case on the verge of collapse, and that has been a widespread belief for
most of the last decade. During the past two years, however, a number of
problems worsened. Inflation has hit annual rates of more than 60%, and the
country has faced an increasing shortage of essential consumer goods like milk
and toilet paper. Venezuela currently has four different exchange rates. Most
dollars are bought from the government at the official rate of 6.3 VEB per U$D
and is intended for essential goods, such as food and medicine. Some other
importers can buy dollars from the government at a rate of about 11 VEB per
dollar on a limited exchange called SICAD 1. There is also SICAD 2, which was
introduced in March and involves private sellers, at a rate of 50 VEB per
dollar. Finally, there is the unregulated black market where dollars currently
sell for about 79 VEB per dollar. A lot of the current problems do seem to be
connected to the exchange rate system. Prior to adoption of the SICAD 2 system,
the black market rate for the dollar had risen from 12 VEB in October 2012 to
88 VEB in March. Once the black market differential is big enough it increases
the incentive for corruption as you can get access to official dollars at 6.3 VEB
and sell them on the black market. If inflation continues at current levels,
even the SICAD 2 rate of 50 VEB per dollar would eventually become an
overvalued exchange rate in real terms. According to the Bank of America’s
March report, Venezuela has about U$D 50 billion in foreign exchange reserves (although
most of the central bank’s reserves are in gold, these can be easily sold –
currently at a sizeable profit relative to their purchase price.) Imports have
been shrinking over most of the past year. All of this should give the
government a comfortable margin of foreign exchange with which to manage the
transition. (Fortune, http://fortune.com/2014/07/22/how-to-fix-venezuelas-toubled-exchange-rate/)
Analysts warn U$D 15 billion are needed to dismantle
Venezuelan FOREX control
The Venezuelan regime plans to announce its plan to
unify the three types of current exchange rate into one in August. However,
experts insist the process must be accompanied by an elimination of market
restrictions and a series of tax and monetary corrections to prevent the
mega-devaluation that would ensue pushes the country into a hyper-inflationary
spiral. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=40325&idc=2)
China increasingly cautious toward Venezuela
The Eurasia Group reports that the Chinese government
is increasingly cautious about financing Venezuela. They demand specific projects
and seek to keep the same amounts in hard currency deliveries. During Chinese
President Xi Jinping's recent to Caracas they only agreed to renew one tranche
of the Bi National Fund, for U$D 4 billion. "However, they did not renew the U$D 20 billion Long Term Great Volume
Fund which Venezuela was interested in". More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/mercados/china-ahora-exige-proyectos-y-es-mas-cautelosa-con.aspx#ixzz38I2y8Anu)
Politics
Retired Venezuelan General Hugo Carvajal detained on
U.S. Petition over drug trafficking
A former chief of Venezuela’s military intelligence
agency, accused by the U.S. of having ties to drug trafficking and Colombian
Marxist rebels has been detained in Aruba and handed over to the DEA on an
extradition petition by the U.S government in charges cocaine trafficking. Retired
General Hugo Carvajal, a confidant of the late President Chávez, was awaiting
confirmation as President Nicolás Maduro’s consul general to Aruba. In 2008,
along with the current state governors of Guárico (Captain Ramón Rodríguez
Chacín) and Trujillo (General Henry Rangel Silva), he was put on a U.S.
Treasury Department blacklist alleging they protected drug shipments for
Colombia's terrorist FARC guerrilla, and also provided the rebel group with
weapons and logistical help. Venezuela’s foreign ministry claims the arrest by
Dutch authorities is a violation of a 1961 international convention governing
diplomatic relations and demanded that Carvajal be freed, warning that
commercial and energy relations with Aruba could be damaged if he isn’t. President
Nicolás Maduro declared "He is
kidnapped ... I put my hand in the fire for Major General Carvajal and I will
defend him with all the possibilities and strength of the Venezuelan state ...
We will not allow Venezuela's honor to be stained.... this ambush strengthens
our civilian-military union". Carvajal was arrested upon landing in a
private aircraft and at first providing a fake passport. The Dutch government had
rejected his appointment as consul due to charges against him. Aruba's
Prosecutor says "He had no function
here in Aruba, he is not Consul General, and he therefore has no immunity".
The U.S. plans to formally request extradition and Carvajal will be taken
before a local judge to determine whether his detention complies with
international treaties. According to El Nuevo Herald of Miami, he
has seven cases pending against him in U.S. courts. In a May 2013 indictment
Carvajal is accused of assisting Colombia's North Valley Cartel, including the
late Wilber Varela, alias "Jabon", to ship cocaine from Venezuela
between 2004 and 2008, while bribing high-ranking military and law enforcement
officials. (Reuters, http://www.reuters.com/article/2014/07/24/us-venezuela-arrest-idUSKBN0FT2ET20140724;
El Universal, http://www.eluniversal.com/nacional-y-politica/140724/general-hugo-carvajal-detained-in-aruba;
http://www.eluniversal.com/nacional-y-politica/140724/venezuelan-govt-terms-unlawful-carvajals-detention-in-aruba; Fox News, http://www.foxnews.com/world/2014/07/24/aruba-prosecutors-say-venezuelan-intelligence-official-detained-on-request-from/;
The New York Times: http://www.nytimes.com/reuters/2014/07/24/world/europe/24reuters-venezuela-arrest.html?ref=americas&utm_source=Sailthru&utm_medium=email&utm_term=%2AMorning%20Brief&utm_campaign=2014_MorningBrief7.25.14&_r=0; and more in Spanish: El Universal, http://www.eluniversal.com/nacional-y-politica/140725/gobierno-califico-de-ilegal-arresto-de-carvajal-en-aruba; and AVN; http://www.avn.info.ve/contenido/presidente-maduro-manifest%C3%B3-respaldo-diplom%C3%A1tico-detenido-ilegalmente-aruba; El Nacional; http://www.el-nacional.com/)
Former Venezuelan judge arrested in Miami for drug
trafficking
Another former Venezuela official was hauled into
federal court in Miami, accused of taking bribes from South American drug
cartels in exchange for help moving large shipments of cocaine to the United
States. Benny Palmeri-Bacchi, 46, an attorney and former Venezuelan judge,
pleaded not guilty to charges of distributing cocaine to the United States,
conspiracy to obstruct justice, money laundering, and extortion in a Miami
federal court. He was arrested after he flew into Miami on a family vacation to
Disney World. He is charged with Rodolfo McTurk, ex-director of Interpol in
Venezuela. The pair allegedly helped Jaime Alberto Marin Zamora, a drug kingpin
with Colombia's North Valley Cartel, ship "thousands of kilograms of cocaine" from Venezuela to the
United States, according to a federal grand jury indictment in the Southern
District of Florida unsealed in December 2013. Prosecutors are seeking to seize
U$D 2.5 million from Wells Fargo and Espirito Santo Bank accounts owned by the
men. (The New York Times, http://www.nytimes.com/reuters/2014/07/24/world/europe/24reuters-venezuela-arrest.html?ref=americas&utm_source=Sailthru&utm_medium=email&utm_term=%2AMorning%20Brief&utm_campaign=2014_MorningBrief7.25.14&_r=0)
Opposition leader Leopoldo Lopez on trial
The trial of one of Venezuela's main opposition
leaders, Leopoldo Lopez, has begun in Caracas. He is accused of inciting
violence during anti-government demonstrations and has been in custody since 18
February, when he handed himself in to the authorities. Lopez has accused the
government of President Nicolas Maduro of jailing Venezuelans for seeking
democratic change. There was heavy police presence and road blocks near the
Justice Palace, but hundreds of supporters, including Lopez's wife, Lilian
Tintori, and parents, gathered outside the court to call for his release. Lopez
faces a maximum sentence of 10 years in jail if convicted. During the first
session of his trial, López professed that they are "rendering the bill" for his political stance. "This trial will measure the quality of
democracy," said the ex-mayor of Chacao municipality. (BBC News, http://www.bbc.com/news/world-latin-america-28457043?utm_source=Sailthru&utm_medium=email&utm_term=%2AMorning%20Brief&utm_campaign=2014_MorningBrief%207.24.14;
El Universal, http://www.eluniversal.com/nacional-y-politica/140724/lopez-feels-that-democracy-is-prosecuted-in-his-case;
Reuters, http://www.reuters.com/article/2014/07/24/us-venezuela-opposition-idUSKBN0FT0AE20140724; Fox News, http://www.foxnews.com/world/2014/07/23/jailed-venezuela-opposition-leader-goes-on-trial-for-inciting-violence-during/)
Denunciations of purported coup plots escalate
Announcements of foiled coups and plots against the
government have long been a part of the Chavista discourse. A study by the
Caracas-based newspaper Ultimas Noticias counted 63 alleged assassination plots
between when Chavez took office in 1999 and his death in 2013. Since then, such
claims have come even more frequently. President Nicolas Maduro's government
has denounced more than a dozen purported plots since coming to power 15 months
ago, according to a tally by The Associated Press. (Fox News, http://www.foxnews.com/world/2014/07/23/escalating-denunciations-purported-coup-plots-instill-fear-in-venezuela/)
Venezuela maintains claim on the Essequibo
Foreign Minister Elías Jaua says
Venezuela's claims against Guyana over the Essequibo territory remain legal and
current under UN rules. More in Spanish: (AVN; http://www.avn.info.ve/contenido/venezuela-ratifica-que-reclamo-sobre-esequibo-es-legal-y-est%C3%A1-vigente)
German press reports illegal weapons sales to
Venezuela
Germany's "Süddeutsche Zeitung" journal reports that Sig Sauer exported
weapons to Venezuela through a Rumanian intermediary, despite a ban by Angela
Merkel's government. The arsenal was sent to Rumania for final processing
to avoid requesting the German government's permission. More in Spanish: (El
Universal, http://www.eluniversal.com/nacional-y-politica/140725/prensa-alemana-denuncia-venta-ilegal-de-armas-a-venezuela)
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